Published: December 19, 2008 -- TOKYO (Reuters) --The Panasonic Corporation, the electronics maker, said Friday that it would spend up to $9 billion to take control of a smaller rival, Sanyo Electric.
Panasonic said it would offer 131 yen ($1.48) for each Sanyo common share, a 4 percent discount to Friday's closing price, with the goal of acquiring a majority stake in Sanyo.
Goldman Sachs said it would tender its Sanyo stake to Panasonic, while Sumitomo Mitsui Banking and Daiwa Securities are considering selling their stakes. The three firms hold nearly 430 million of Sanyo's preferred shares, each of which can be exchanged for 10 common shares when a restriction is lifted in March. If converted, Goldman and Daiwa Securities would each hold a 29 percent stake in Sanyo, while Sumitomo Mitsui Banking would hold about 12 percent.
"Some people may wonder why we join hands with Sanyo when the economic outlook is this cloudy," the president of Panasonic, Fumio Ohtsubo, told a news conference on Friday.
"I believe we need to take bold steps for growth in the time of drastic changes like this while strengthening our business operations," he said.
Panasonic, formerly known as Matsushita Electric, plans to announce the timing for its tender offer by late February.
By acquiring Sanyo, the world's top producer of rechargeable batteries and the seventh-largest maker of solar panels, Panasonic will fortify its lineup of "green" energy products.
Sanyo is developing lithium-ion batteries for cars with Volkswagen, while Panasonic runs an auto battery joint venture with Toyota.
Mr. Ohtsubo said Panasonic was considering investing about 100 billion yen ($1.1 billion) in strategic areas like rechargeable batteries "in a timely and speedy manner" to help create synergy between the two companies.